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The beauty industry slowed moderately in 2013, growing by 5% compared to 6% in 2012, due to a slowdown in emerging markets, specifically China and Brazil, as well as in innovation hub South Korea, a lustreless performance which was bad news to premium players. Latin America and Middle East and Africa remained the only regions growing by double digits, despite issues like high inflation, taxation and unstable political climates hindering prospects in many markets within the regions.
The most defining trend in 2014 will continue to be cross-category alignment, as consumers have become even more accustomed to paying for convenience as well as trying novel products and services. The vast information available, especially in the form of online reviews, has helped minimise the risk of trying new offerings for consumers. BB/CC creams’ robust progression is a testament to how the convenience and novelty that these hybrid products provide has been a successful recipe for beauty companies.
Beyond BB/CC creams, multi-benefit combinations have become ubiquitous within beauty, from foundations with anti-ageing serums to nail polish with UV protection and anti-ageing claims. Consumers have raised the bar in terms of product expectations, which makes it vital for even the most specialised treatments to combine more than one benefit. As a result, multi-benefit solutions will continue to penetrate further into different categories, from hair care with anti-ageing or fragrance to lipsticks with lip care, and even across industries, like Wrangler jeans and Triumph’s underwear with moisturising properties.
2013 was the year of the ‘selfie’, as personal image though social media – whether on Facebook, Twitter, Instagram, Snapchat or other – was the preferred form of communication. With image so important, nail polish and nail art, which allows consumers to showcase their individuality and personality through unique textures and colours, experienced another strong year of growth, albeit subdued compared to the preceding three years.
Young consumers’ continuing preoccupation with image has brought about more tailored offerings, with a rise in specific solution-based products that consumers can relate to. Examples include hyperpigmentation, evening skin tone, scalp health and anti-ageing for hair, among others. Product portfolios are becoming more diverse, catering for a higher number of different consumers, from teens to over 50s, and more gender specific offerings.
Furthermore, the rise of images as the key communication tool has increased the importance of picture-perfect skin. Innovation in 2014 will continue to be driven by a range of products that promise to smooth out imperfections, tighten pores and even out skin tone. Some of the most notable launches in 2013 catering to this trend included the L’Oréal Paris Skin Perfection series, the Idealia Life Serum by Vichy, Lancôme’s Dreamtone, featuring in the Christmas Beauty Innovation Round-Up and most recently Christian Dior’s Dreamskin as cited in our January’s Beauty Innovation Round-Up Series.
The beauty consumer continues to crave luxury and instant gratification through new experiences at accessible price points. One area which will continue to benefit is at-home treatment alternatives against a backdrop of reduced salon visits and the desire for a pampering experience which can be achieved in one’s own home. This has given rise to more salon-inspired innovation including the greater popularity for devices and most recently face masks, the strongest performing category within skin care in 2013 (up by 8%). As players in this field, largely concentrated in Asia, continue to diversify their offerings beyond lightening to radiance, anti-ageing, eye-masks etc.; their popularity is soon expected to spread across developed markets including the US. While beauty devices are still nascent and mainly in the domain of hand-held facial cleansing devices, there are a number of lucrative opportunities emerging, again driven by Asia, such as make-up application devices and ionic facial massagers.
The increasing desire for more affordable luxury, as well as manufacturers’ desire for expansion without compromising brand image, has seen luxury fashion brands extend into the beauty market. Tory Burch and Michael Kors both entered beauty with fragrances and colour cosmetics through Estée Lauder. Marc Jacobs and Tom Ford both expanded the former in colour cosmetics and the latter, in men’s skin care. Furthermore, cult fashion brands like YSL, Christian Dior and Chanel have upped their investment in skin care, which although traditionally avoided by fashion brands, appears to have become the key focus area of expansion.
The post-recessionary consumer craves luxury and instant gratification through new experience and emotion, a trend expected to strengthen in 2014. Beauty players are increasing their focus beyond just result-driven innovation to how consumers interact with products and the senses those products evoke. New product experiences have transpired in a variety of different ways, including novel retail and digital services.
Technology plays a big role in this, such as retail space openings like Chanel and Burberry in London’s Covent Garden, as well as L’Oréal Paris’s first standalone store in Madrid, which all use technology within stores to create an enhanced experience for consumers. Chanel’s photo booth, which takes pictures of consumers and allows them to virtually try on different lipsticks, is a prime example of this. Furthermore, to make this a seamless experience for consumers, brands are also engaging in the digital domain, like Sephora’s recent Pinterest-inspired social-shopping concept, Mary Kay’s makeover phone application and L’Oréal Paris’s virtual kiosks in New York subway stations, which offer consumers the opportunity to purchase make-up products from a vending machine to match their outfits.
Beyond in-store and online experiences, beauty brands are also creating further excitement for consumers through new product formats and formulations. Different textures, like Chanel’s Le Lift line, which is offered as a lotion, cream and gel, new application methods, such as Nivea’s In-Shower body moisturiser and Vaseline’s spray moisturising format, as well as packaging innovations like Unilever’s compressed and portable new deodorants, have all exemplified this trend.